Startup India Registration
Introduction In India, population of youngsters is very high and maximum of youngsters have a dream to become entrepreneur. Some of them have a workable business idea in their mind and on paper but due to shortage of funds they face challenges in converting that business idea into reality. To help these entrepreneurs, the Government of India has launched a scheme known as Startup India and if you meet the criteria prescribed by Startup India Registration then your organisation will be approved by DPIIT and your organisation will be eligible for getting all benefits prescribed under this scheme. Eligibility criteria for recognition from DPIIT Your startup must be incorporated as Private Limited Company or a registered Partnership Firm or a Limited Partnership Firm Its period of existence and operations should not be exceeding 10 years from the date of Incorporation This organisation must not be formed by splitting up or reconstructing an already existing business After the date of incorporation, its Annual turnover should not be exceeded Rs.100 Crore for any of the financial years The idea of business should work towards development or improvement of a product, process or service and/or have scalable business model with high potential for creation of wealth & Employment The firms should have obtained the approval from the Department of Industrial Policy and Promotion (DIPP). To get approval from DIPP, the firm should be funded by an Incubation fund, Angel Fund or Private Equity Fund. The firm should have obtained a patron guarantee from the Indian patent and Trademark Office. Capital gain is exempted from income tax under the startup India campaign. Angel fund, Incubation fund, Accelerators, Private Equity Fund, Angel network must be registered with SEBI ( Securities and Exchange Board of India). It has a recommendation letter from an incubator Steps to Register Your Startup with Startup India Step 1: Incorporate your Business You must first incorporate your business as a Private Limited Company or a Partnership firm or a Limited Liability Partnership. You have to follow all the normal procedures for registration of any business like obtaining the Certificate of Incorporation/Partnership registration, PAN, and other required compliances. Step 2: Register with Startup India Then the business must be registered as a startup. The entire process is simple and online. All you need to do is log on to the Startup India website and fill-up the form with details of your business. Next, enter the OTP which is sent to your e-mail and other details like, startup as the type of user, name and stage of the startup, etc. After entering these details, the Startup India profile is created. Once, your profile is created on the website, startups can apply for various acceleration, incubator/mentorship programmes and other challenges on the website along with getting access to resources like Learning and Development Program, Government Schemes, State Polices for Startups and pro-bono services. Step 3: Get DPIIT Recognition The next step after creating the profile on the Startup India Website is to avail Department for Promotion of Industry and Internal Trade (DPIIT) Recognition. This recognition helps the startups to avail benefits like access to high-quality intellectual property services and resources, relaxation in public procurement norms, self-certification under labour and environment laws, easy winding of company, access to Fund of Funds, tax exemption for 3 consecutive years and tax exemption on investment above fair market value. For getting DPIIT Recognition, click on the ‘Get Recognised’ button if you are a new user. If you are an existing user click on the ‘Dashboard button’ and then ‘DPIIT Recognition’. Step 4: Recognition Application The ‘Recognition Application Detail’ page opens. On this page click on ‘View Details’ under the Registration Details section. Fill up the ‘Startup Recognition Form’ and click on ‘Submit’. Step 5: Documents for Registration Incorporation/Registration Certificate of your startup Details of the Directors Proof of concept like pitch deck/website link/video (in case of a validation/ early traction/scaling stage startup) Patent and trademark details (Optional) PAN Number Step 6: Recognition Number That’s it! On applying you will immediately get a recognition number for your startup. The certificate of recognition will be issued after the examination of all your documents which is usually done in 2 days after submitting the details online. However, be careful while uploading the documents. If on subsequent verification, it is found to be obtained that the required document is not uploaded/wrong document uploaded or a forged document has been uploaded then you shall be liable to a fine of 50% of your paid-up capital of the startup with a minimum fine of Rs. 25,000. Step 7: Other Areas Patents, trademarks and/or design registration: If you need a patent for your innovation or a trademark for your business, you can easily approach any from the list of facilitators issued by the government. You will need to bear only the statutory fees thus getting an 80% reduction in fees. Funding: One of the key challenges faced by many startups has been accessing finance. Due to lack of experience, security or existing cash flows, entrepreneurs fail to attract investors. Besides, the high-risk nature of startups, as a significant percentage fail to take off, puts off many investors. In order to provide funding support, the Government has set up a fund with an initial corpus of INR 2,500 crore and a total corpus of INR 10,000 crore over a period of 4 years (i.e. INR 2,500 crore per year). The Fund is in the nature of Fund of Funds, which means that it will not invest directly into Startups, but shall participate in the capital of SEBI registered Venture Funds. Self Certification Under Employment and Labour Laws: Startups can self certify under labour laws and environment laws so that their compliance costs are reduced. Self-certification is provided to reduce regulatory burden thereby allowing them to focus on their core business. Startups are allowed to self-certify their compliances under six labour laws and three environment laws for a period of 3 to 5 years from the date of incorporation. Units operating under 36 white